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New company retirement funds...please suggest

bnath001
edited May 2013 in Fund Discussions
Hello folks,

My wife recently joined a company. They have bunch of funds. But, I wanted to listen to the opinon of this forum on the following funds that are available. Her age is 40 years old. about 200K in IRA. But we are not rolling over that money into the new company's 401k account.

Vanguard REIT Index Fund Signal Shares - VGRSX
Vanguard Windsor II Fund Investor Shares - VWNFX
Vanguard Target Retirement 2040 Fund -VFORX

Thanks
basam

Comments

  • jerry
    All these funds are fine. If you want to minimize the number of funds I think a deep value fund like windsor 1! might not be appropriate. You should check that the asset allocation for the 2040 fund is what you want. Its only 10% bonds which you may or may not think is appropriate. Having 5% in reits may work out well and should do little harm but I wouldn't try something like 20% All things considered the 2040 fund looks best but if a stable value option with a decent rate (2,5% or higher) is available I would have a portion in that perhaps as a bond substitute and as a source of additional investment power if the market drops 15-20%
  • beebee
    edited May 2013
    Hi bnath001,
    Does her present IRA reside within her previous employers 401k plan? If so, transfering the $200k to a self direct IRA would be my first suggestion. With her present employers plan, Vanguard is a great way to avoid high fees though their maybe some indirect fees (third party administration and the like). The Target fund seems the most diversified. I like the Vanguard REIT fund and have no problem with Windsor II but both would be complimentary to a well diverisified single choice like VFORX. Both sectors (REIT and LCV) are represented in VFORX to a certain degree anyway. Are there other retirment date choices.

    As jerry mentioned you may be able to increase/decrease your percentages of the three underlying investment in VFORX (VTI,VT,BND) by choosing a different retirement dated fund like 2030 (VTHRX) or 2050 (VTTRX).
  • bnath001
    THANKS folks.

    Always a big fan of this forum.
    regards
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